Want to know if a magic number really works as a retirement plan?
Looking for advice from professionals in wealth management in Ann Arbor about saving for retirement?
We understand that planning for retirement is complicated. Really complicated. And it’s actually harder to figure out and more abstract the further away you are from retirement age. That’s where the idea of the magic number for retirement savings comes in handy. Without needing incredibly specific plans for retirement, calculating the magic number allows people to begin a solid retirement fund early in life to setup success and comfort later on.
But the truth about the magic number is that it’s just a rough estimate and can’t take the place of a retirement plan tailored to your life.
What’s your magic number?
The general rule for calculating the magic number is to save ten times your final salary by retirement age, or 67 years. That means if you expect to make $85k/year at retirement, you should have saved $850,000 in a retirement fund.
This is a great place to start, but leaves a lot out of the equation like your precise social security benefit, plans for travel, reduced living expenses if you downsize or move to a less expensive area, or any interest in leaving an inheritance for children.
Because you could end up needing a lot more or a lot less that your magic number depending on how you want to spend retirement, basing your plan on the oversimplified equation is usually not the best route.
Trust your retirement plan to a professional in wealth management in Ann Arbor
Don’t settle for a retirement savings goal that’s one-size-fits-all. Get a plan tailored to your unique situation, wants, and needs with Imber Wealth Advisors in Ann Arbor. Give us a call today to make sure you’re on the right plan for the retirement you’ve been dreaming of.